Scramble for Africa threatens to leave continent starving

Mechanised rice harvesting at a 17,000-hectare farm in western Kenya leased out to a US company to grow rice. Rich countries are leasing prime land on the continent in deals which critics say pay little attention to the fate of the communities dispossessed in the process. By 2013, most of these deals were in seven countries: Ethiopia, Ghana, Madagascar, Mali, Sudan, Mozambique and Tanzania. PHOTO | FILE

In five short years, rich countries have acquired about 80 million hectares of land in Africa and other developing countries in what is now a worrying trend.

Critics have dubbed this “the big land grab”, or “the new type of neo-colonialism”. What is happening?

Now, foreigners have always owned land in Africa. What is new in this “second scramble for Africa” is the scale, size and more importantly, the exclusion of civil society and local communities in the process.

The United Nations has very little data, and the governments or corporations involved are not willing to talk.

There is a strong feeling among observers that most of the negotiations are done behind closed doors.

The sheer mystery surrounding these acquisitions and the circumvention of land laws of the host countries have attracted global attention.

“There is a huge lack of transparency on land governance matters...regarding pricing, decision-making processes, contractual agreements and issues of community involvement and compensation,” says the International Land Coalition (ILC).

Land acquisition of such a scale in Africa was last witnessed in the historical scramble for the continent more than a century ago, when European powers met in Berlin, Germany, drew arbitrary lines on a piece of paper, and shared the different parts of the continent among themselves.

Host governments are generally receptive to these acquisitions for obvious reasons: they offer various opportunities to create jobs, increase foreign direct investments and of course, for the extraction of rent.

But questions are emerging about the implications of these land deals, especially the exposure of economically fragile groups to further marginalisation through speculation and land rights transfers, loss of access to land and resources for pastoralists, small-scale agricultural producers, and subsistence farmers.

Factors behind the rush for land

Firstly, the recent increase in food prices around the world has raised fears of mass hunger in rich countries.

The food riots in Egypt, Senegal, and other parts of the world a couple of years ago stirred rich countries to lease land in Africa, South America and Asia, fearing similar protests in their countries.

American, Asian and Middle East companies have leased millions of acres in developing countries.

Secondly, the world is reeling from an energy crisis. The sharp increase in the price of fossil fuels in the last 10 years and the emerging global ecological trends, particularly climate change, has placed tremendous pressure on governments to find suitable alternatives to fossil fuels.

The hidden factors are more unsettling. Globally, the world is moving more and more towards bio-fuels.

The European Union, for example, requires that 10 per cent of all transport fuel should come from plant based bio-fuels.

The US Congress has already voted to increase ethanol production. In 2011, 130 million tons (40 per cent of US production) of corn was converted to ethanol. Food production is becoming increasing sidelined.

In all, Africa should expect a greater rush for land by foreigners due to the anticipated rise in prices, consumption rates and market demand for food, bio-fuels, raw materials, water and timber.

There is also increasing carbon sequestration and trading (making money by removing carbon from the atmosphere).

Of the 1,217 deals reported by the ILC, 754, representing 56.2 million hectares, are in Africa.

By 2013, most of these deals were in seven countries: Ethiopia, Ghana, Madagascar, Mali, Sudan, Mozambique and Tanzania.

Some reports say 60 million hectares of African land had been purchased or leased by 2009.

Overall, 83.2 million (some say up to 227 million) hectares have been sold or leased since 2001 in developing countries.

This represents 1.7 percent and 4.8 per cent of the world’s and Africa’s arable land respectively.

Further, one third of the transactions in Africa are in eastern Africa, with Tanzania and Ethiopia leading the pack.

Investors are targeting underprivileged countries that are poorly integrated into the world economy, and with weak land institutions and, therefore, feeble tenure security.

Sixty-six per cent of the reported deals are in countries with a high prevalence of hunger.

Investors like to cut corners

Africa is especially targeted because of its abundant natural resources, cheap labour, and the fact that land is mostly state-controlled, and therefore, easy to acquire.

“Africa is particularly attractive to land grabbers due to the perception that there are vast amounts of land available for large-scale agricultural investments.

“Not only does Africa have a lot of available land, but it is cheap, has rich natural resources such as water and soil nutrients and there is cheap labour available for agricultural production,” says a report, 'Land Grab in Kenya', by Pauline Makutsa.

Although there are large leases reported in Kenya, information about them is scanty.

However, lobby groups for the rights of marginalised communities have been raising issues regarding the rights of the local stakeholders at the community level. Perhaps the best example of this trend is the Dominion Farms in Western Kenya.

The country’s Vision 2030 recognises the centrality of the agricultural and natural resources sectors in the economy.

This development blueprint identifies agriculture as one of the key sectors that should propel Kenya’s projected growth rate to 10 per cent annually. But to boost agriculture, foreign direct investment has to be encouraged.

To this end, the Investment Promotion Act was enacted in 2004, giving legal teeth to Kenya’s investment agenda.

Currently, the government is looking for investors for the Galana-Kulalu irrigation scheme in Tana River and Kilifi counties at the coast region.

The only requirements for foreign investors in agriculture is proof that their ventures will contribute towards job creation, skills and technology transfer, tax revenues and foreign exchange, as well as use of local raw materials.

There is no evidence from implemented farm projects elsewhere that this happens, because investors quickly look for ways to cut costs as much as possible.

“The investment legislation and policy do not require that the investor look into the economic, social, cultural land environmental impacts and implications of their investment, particularly on local communities,” says the report by Makutsa.

The study focused on the Tana River Delta region, the most targeted area for large-scale land acquisition in the country. The investments in the delta and the surrounding areas add up to more than 500,000 hectares.

These investments range from sugarcane plantations, bio-fuel crops such as jatropha, crambe, sunflower and vegetables.

Impact of these ventures

Since investors have a tendency to target land with high yield gaps, good accessibility and desirable population density to source labour, there is increasing fear of future competition for cropland between local communities and investors.

Indeed, land conflicts, water, mineral rights and other land-based resources are on the rise.

In some countries, ignoring the land rights of the host communities in these deals has led to repeated conflicts.

A major cause of the wars in central African countries like the Democratic Republic of Congo have their origin in warped land transactions involving multinationals.

Large farming or mining communities are suddenly dislocated from their ancestral land, leading to more poverty and instability.

Underrated in this debate are the environmental effects of the large-scale “scientific” farming.

The effects of massive use of chemicals and huge amounts of water are just beginning to be felt in Asian countries that embraced the “Green Revolution” in the 70s.

China, for example, has millions of wasted hectares that are now undergoing rehabilitation. There is no knowing the extent of the impact on human and animal health.

In central Africa and some west African countries, land transfers are characterised by poor contracts, low prices and inadequate government taxation on profits.

Most foreign investors use tax avoidance tactics like offshore investment. The effects of these are all too obvious.

Pollution is common. Images from the Niger Delta, for example, grimly portray what happens when governments scheme with foreign investors with little regard to local communities and their ecology.

Pollution in the Delta portrays the insatiable greed that informs some of these transactions. Elsewhere, we see serious threats to wildlife resources.

Hundred per cent food repatriation

Faced with hunger, high unemployment, and the need for investments, it is easy to understand why host countries might not be overly concerned with these issues.

Although supporters of these transactions cite food security as one of the benefits, it is not obvious that the land deals will address local food insecurity.

Most of the land leased is for speculation, bio-fuels and food production for export, leaving no food to meet local needs.

What worries observers is that most investors seem to insist on a 100 per cent food repatriation. In most of the contracts, domestic markets are of marginal concern.

Besides, the farmers are often contracted to grow patented seeds with a “terminator gene”, which ensures that they cannot replant the seeds, effectively ending family farming systems that have for generation ensured seed preservation.

Or they may get chicks and return the hens when they mature. They are just paid for their labour. In all these, the traditional role of farmers in deciding what to plant, when and how, is lost.

Due to the exposure this is causing to poor farmers, there is a reported rise in suicide cases in India and other Asian countries where contract farming is widely practiced.

However, countries are increasingly looking for solutions to these problems. Both the African Union and the UN have come up with a framework and guidelines on land policy intended to help countries review their individual land policies and laws.

The guidelines specifically caution member states to ensure that their land policies provide adequate measures to guarantee that market-driven policies for land development do not expose vulnerable groups to further marginalisation through speculation and land rights transfers.

The UN has called for a “code of conduct” to regulate international purchases of farmland. There is pressure to base the deals on the principle of free, prior and informed consent (FPIC), which is formalised through article 32 of the 2007 UN declaration on the rights of the indigenous peoples.

New form of 'neo-colonialism'

The basic principle here is that local land stakeholders have the right to accept or reject proposed development on their land. And governments are responsible for making sure that effective systems for grievance, redress and mitigation are in place.

Some countries like Mali, Mozambique and Ghana have streamlined their administrative processes to enhance transparency. One-stop shops and investment promotion agencies play key roles towards that end. And more rich and poor governments alike are making tax evasion increasingly difficult.

Today, several African governments favour investors who will generate substantial spillovers for the local economy. In addition, governments are increasingly requiring that companies buying assets publicise details of assets sales.

Still, others like Ghana and Botswana, have managed to invest back substantially in social services. Also popular is the use of public-private-partnership facilities. Generally, countries are enacting stricter laws on contracts.

By and large, the single most important solution is to work out a model that does not involve the transfer of land rights from communities to investors. Proponents cite the rosy side of the trend, pointing out that if anything, Africa needs to encourage “foreign investments”.

Where critics see the latest form of “neo-colonialism”, supporters point at the economic benefits in countries where massive leases have allegedly revamped agriculture and raised foreign exchange earnings.

Ethiopia is said to exports fruits worth $60 million (Sh5.1m) and $160 million (Sh13.6bn) million dollar worth of flowers, thanks to foreign-owned farms.

In this breath, such positives as jobs creation and food security are mentioned as some of the benefits. “The thing is, foreign firms have owned land in Africa since the onset of colonisation," says a supporter in one of the numerous reports written on the subject.

"In many countries, colonial farmers never left. And where they did, local political elites took over and continued the same commercial production. What is the difference between that and a foreign firm leasing land now?”

Well, time has changed. Today people are more alert and aware of their rights than they were 50 years ago.